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2019 (10) TMI 444 - ITAT DELHIDisallowance u/s 14A read with Rule 8D - HELD THAT:- The assessee has non-interest bearing funds also which were more than the investments made by assessee. Thus, no cost of fund is involved in earning the exempted income. Further, in this year assessee has no net expenditure as there is a net interest income and in earlier year, no similar disallowance out of interest have been made. The reliance of the assessee on the decision of UMIL Share & Stock Broking Services Ltd. [2018 (8) TMI 913 - ITAT KOLKATA] clearly apply to the facts of the case of the assessee. No justification for the authorities below to disallow interest expenditure relating to exempted income. We, accordingly, set aside the Orders of the authorities below and delete the addition. As regards other addition assessee has not filed any reply before the authorities below. No details or explanation have been filed. No explanation have been given regarding the activities carried out by the assessee for earning the exempted income. Since assessee earned substantial dividend income, therefore, assessee was bound to incur certain expenditure to earn exempted income, therefore, in the absence of any explanation or any details submitted by assessee before the authorities below as well as before the Tribunal, disallowance is confirmed. Part of this ground is dismissed. Ground No.1 is partly allowed. Addition on account of deduction claimed u/s 36(1)(viia) - HELD THAT:- We are of the view that issue is covered in favour of the assessee by the aforesaid decision of the Tribunal in the case of assessee in which the Order of Tribunal for the A.Y. 2011-2012 have also been considered which is the sole basis for the A.O. to make the disallowance. We, accordingly, following the Order of the Tribunal above, set aside the Orders of the authorities below and delete the entire addition. In the result, Ground Nos.2 and 3 of the appeal of Assessee are allowed.
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